[sah2ed]

I think your example scenario would have benefited from some qualification as you paint the sentiment around the decision to put a stock up for sale in a somewhat negative light when in fact there can be several factors at play.

> The person who sold the shares had deemed the stock a not-so-good investment compared to other options and wished to liquidate.

That's one possible explanation for the decision to sell. The person could also be motivated to sell (a portion) because the current price would lead to a modest return on the initial investment; or perhaps the person suddenly needs cash and decided that a stock (from among several positions) would yield a certain amount of liquidity, ROI considerations will generally not factor into distress sale decisions.

[grandalf]

> you paint the sentiment around the decision to put a stock up for sale in a somewhat negative light

Only to the extent that all stocks, bonds, and investments (in a sense) compete against each other. Thus, selling means that the owner decided that one of the competitors was a better fit. Of course, as you point out, it could just be due to some unrelated cash flow issue.